Does Texas sales tax apply to a floral order that a Texas florist takes over the internet from an international customer, if the flowers are delivered outside the U.S. by an unrelated florist?

Subject

Internet Flower Service — Florist Takes Orders Placed Via Web Site To Be Delivered Anywhere In The World — Flower Wire Services Used For Order Fulfillment

Plain-English summary

A Texas florist emailed the Comptroller asking about the tax treatment of floral orders that international customers placed through the florist's web site in Texas, where the actual delivery would then be made by a third-party (wire-service) florist located outside the United States.

The Comptroller's answer: the charge is taxable. The letter points to Rule 3.307(c), which states that sales tax is due on amounts charged by a Texas florist for taxable items purchased in Texas for delivery outside the state -- and that this holds true whether the florist who took the order makes the delivery, or an unrelated florist outside Texas is instructed to make the delivery instead. Because the order itself was taken in Texas, the charge for it is subject to Texas sales tax, regardless of where the flowers ultimately end up.

The letter notes this opinion is rendered based on the facts presented, and could change if the facts were different.

What this means for you

Florists selling online or through wire services

If your web site (hosted or operated in Texas) takes an order from a customer for flowers to be delivered anywhere in the world, the sale is taxable in Texas as long as the order was taken here -- even if you never touch the flowers and an out-of-state or foreign florist fulfills delivery through a wire service. Where the flowers end up delivered does not matter; what matters is where the order was taken.

Accountants and tax professionals advising florists or online retailers

This ruling applies the general Rule 3.307(c) principle -- tax is due on taxable items purchased in Texas for delivery outside the state, regardless of who makes the delivery -- specifically to internet-based floral orders. It's a useful precedent for any Texas-based retailer using wire services, drop-shippers, or fulfillment partners located elsewhere: taking the order in Texas is what triggers the tax, not the location of final delivery.

Common questions

Q: Is a Texas florist's internet flower sale taxable if the flowers are delivered outside Texas or outside the U.S.?
A: Yes. Under Rule 3.307(c), sales tax is due on amounts charged by a Texas florist for taxable items purchased in Texas for delivery outside the state, no matter where delivery occurs.

Q: Does it matter if a different, unrelated florist actually delivers the flowers?
A: No. The rule expressly states tax is due "whether the items are delivered by the florist who took the order or by an unrelated florist outside Texas who is instructed to make delivery."

Q: Could this outcome change under different facts?
A: Yes -- the letter explicitly says the opinion is rendered based on the facts presented, and the opinion may change if there are additional or different facts.

Citations and references

Rules:

• Rule 3.307(c) (tax due on taxable items purchased in Texas for delivery outside the state, regardless of who makes the delivery)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9610051L

Original ruling text

October 28, 1996

Dear ***:

Thank you for your recent email regarding the tax treatment of floral orders
placed through web sites in Texas by international customers for subsequent
delivery by third-party florists located outside the United States.

Policy in this area is set out in Rule 3.307(c) which states:

Sales tax is due on amounts charged by a Texas florist for taxable items
purchased in Texas for delivery outside the state. Tax is due whether the
items are delivered by the florist who took the order or by an unrelated
florist outside Texas who is instructed to make delivery.

Accordingly, charges for floral orders taken in Texas are subject to Texas
sales tax. I am enclosing a copy of the rule as an enclosure to this email.
You may also down load a copy of the rule through our web site at
.

This opinion is rendered based on the facts presented. If there are additional
or different facts, the opinion may change.

You may call me toll free at 1-800-531-5441, ext. 3-4680. The direct line is
512/463-4680. You may also write to Tax Policy, Comptroller of Public
Accounts. My Internet address is .

Sincerely,
Al Van Allen
Tax Policy Division